The hardest thing about taking control of your money is getting started.

Where to begin? Money can be an uncomfortable topic, so friends and family avoid discussing it. The sheer amount of information -and misinformation- about personal finance online is overwhelming.

Below is a quick-start guide to getting organized with your money without having a nervous breakdown. With a little organization (no vision boards, I promise), we can get through this.

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STEP 1: Stop beating yourself up about money.  

If personal finance were easy, Americans wouldn’t be averaging over $16,000 in household credit card debt. If you are reading this, you’ve already taken the biggest step towards long-term financial security: caring in the first place.


STEP 2: Calculate your net worth.  

The best place to start is by filling out a balance sheet, the financial scorecard that calculates your net worth. It’s exactly what it sounds like: a spreadsheet that lists all your assets, all your debt, and totals them up to determine if you’re in the red or the black.

The only way to improve your financial health is to take an honest snapshot of your current situation. If you are ready to quit already, take a hot minute and revisit STEP #1. We’ll wait.


STEP 3: Set some life goals.

Money doesn’t exist for its own sake. It’s a tool to help people achieve their life goals. Whether you want to buy a house and raise 5 kids, or backpack across the world and become a travel writer, it’s going to take a financial plan.

It’s never too late to set personal goals. I have some clients who are 60+ years old, and my first question remains the same, “What do you want to be when you grow up someday?” The answer isn’t always a job.

Is your dream to retire in a beach house? Or to sit on the board of your favorite charity? Maybe you want to give your grandkids a student loan-free education someday. Defining your personal goals is the first step in creating a financial strategy.


STEP 4: Check your credit score and report.

Your credit score is what lenders look at before they decide whether or not to front you some money. Having a bad credit score can hurt your chances at buying a house someday, opening a new credit card, getting a decent insurance policy, or even landing a job. It’s also not a bad idea to scan your credit report for suspicious activity that could indicate identity theft.

There are 3 major credit bureaus: TransUnion, Equifax and Experian. Credit scores can range from 300-850 (which is kind of a weird scale, but we all roll with it).  The higher the score, the better. You can check all 3 of your credit scores for free every year at


STEP 5: Be strategic about your debt management plan.

Lenders don’t offer minimum payments as a courtesy. Paying the bare minimum leaves you paying a lot more interest in the long-term.

Make sure you are structuring your debt plan to pay off principal (aka. the actual amount of debt you owe), not just the interest. Start by making a list of your debts and their interest rates. General rule of thumb: whichever one has the highest interest rate, pay that off first.

Like most things in life, there are always exceptions to the rule. A financial advisor can help you determine what debt management strategy works best for your financial personality.


STEP 6: Make a budget realistic to your life goals.

Once you have a better sense of what you’re planning for, it’s time to create a budget.

Start with a list of recurring income and expenses (ie. any bills you pay on a yearly, quarterly, or monthly basis). Check your credit card statements for gas and grocery bills to figure out their average monthly costs. If you are feeling ambitious, include holiday shopping and vacations as annual recurring expenses so they don’t sneak up on you.  

Don’t forget to include a cash cushion for one-time costs like wedding presents (and travel), medical bills, or the “accidental” 2am online shopping spree.


STEP 7: Switch your paycheck to direct deposit, and set bills to auto-pay.

Auto-billing prevents you from accidentally missing payments, and allows you the opportunity to rack up credit card rewards points in the process. If you dread the idea of having multiple online billing accounts, consider a password manager like RoboForm or LastPass to make sure you never get locked out.  


STEP 8: Open a high-yield savings account.  

Are you tired of working your butt off to save money, only to have the bank award your sacrifice with a measly .10% interest? Online-only banks like Bank of Internet USA (BoFi) and others provide FDIC-insured deposit accounts with interest rates as high as 1%.

Think dollars of interest each month, rather than pennies. If you are primarily using online and mobile banking anyway, a high-yield savings account is a great opportunity to start collecting serious interest on your savings.


STEP 9: Increase your retirement and college savings contributions.

If your employer offers a 401k contribution match, you should at least be paying the maximum match into your plan. If you can spare it (and most people can), increase your contribution rate by a few percentage points.

The earlier you start saving for college and retirement the better, thanks to compound interest: the force within the financial universe that accumulates “interest on your interest.” In other words, saving $100 a year for 10 years will have a much larger return than simply having $1000, 10 years from now.

Become friends with compound interest. You will be shocked at the difference it makes.


STEP 10: Update your estate plan- especially your beneficiary information.

If you don’t write up a will or establish a trust (or both), the biggest beneficiary of your life’s work might be the government. Also beware, the beneficiary arrangements on life insurance and retirement plans actually trump the wishes laid out in a written will.

Just to review: if you don’t have an estate plan, your money could go to the government. If you have an outdated estate plan, your money could go to your ex-husband. (I’ll let you decide which one is worse.)

While you’re accessing any IRA retirement plans, Roth IRAs, single-k plans, or beneficiary IRAs for your balance sheet, protect your legacy and make sure the beneficiary information is accurate.


STEP 11: Revisit your insurance policy.

If you are planning to start a new business, start a family, make a major purchase, or retire comfortably, you need to manage your risks. Being properly insured is the responsible thing to do (I believe kids these days call this “adulting”) but don’t let insurance companies talk you into paying for more coverage than you need.

A financial advisor can help match you with insurance coverage that best meets your needs and lifestyle, including: disability, life, long-term care, health, medical savings accounts, auto, business, homeowners, excess liability (umbrella) and more.

STEP 12: Meet Annually with a Certified Financial Planner (CFP®)

Society doesn’t expect you to be an expert on fitness, cars, or home repair. You shouldn’t have to be an expert on debt reduction, insurance, or cash flow analysis either.

A Certified Financial Planner® practitioner can help you determine your unique financial goals, develop a spending budget, calculate your net worth and retirement number, identify your risk tolerance, and maybe even help you find money from a 401(k) you forgot about years ago.

You don’t have to be a millionaire to have a financial plan. Today is the day to start planning your family’s future.

Disclaimer: Registered Representative, Securities offered through Cambridge Investment Research, Inc., a broker/dealer. Member FINRA/SIPC. Investment Advisor Representative Cambridge Investment Research Advisors, Inc. a Registered Investment Advisor. Financial Planning Services offered through Bodnar Financial Advisors, Inc., a Registered Investment Advisor. Cambridge and Bodnar Financial Advisors, Inc. are not affiliated. These are the opinions of Bodnar Financial Advisors, Inc. and not necessarily those of Cambridge, are for informational purposes only, and should not be construed or acted upon as individualized investment advice. Indices mentioned are unmanaged and cannot be invested into directly. Past performance is not a guarantee of future results.